Surviving Digital Disruption: Practical Tips for Directors and Senior Executives
Kate Ellis: Welcome to third Governance Institute and Diligent webinar. Part of a three part series. My name is Kate Ellis and I’ll be your joint host for today. Just a little bit about myself, I run the marketing here for Diligent across Australasia. Now Diligent in developing and providing government software for boards and directors since 2001. We are now trusted by the 140,000 board members and executives across 72 countries, and I’d like to thank the Governance Institute in Australia with their continued support and partnership with Diligent.
Today’s section will be looking at ways to survive digital disruptions for directors and senior executives. Today we have the privilege to listen to the renowned speaker in her field, Elizabeth Valentine. Elizabeth is the managing director of Enterprise Government Consulting. She specialises in helping boards and senior executives to build the personal and collective digital intelligence required to lead, and govern digital transformation. She is a acknowledged international expert in determining new and emerging areas of capability development, that effects board and executive performance. Elizabeth is an experienced chief executive, company director, and the author of a range of industry publications. She brings both well researched as well as highly practical actionable insights to a consulting practice seminar, workshop, and executive coaching assessment. I believe this will be the third time I have had the honour to hear Elizabeth speak and I always look forward to her sessions. I will hand this over to you Elizabeth.
Elizabeth V.: Thank you very much Kate, I appreciate that introduction. Diligent by numbers, lots of coverage around the world. Let’s get straight into the purpose of what we’re going to be talking about today. This is an overview and an introduction, but it is about the business rather than the technology. It’s understanding the nature and scale of change from a business perspective. You get some takeaways so you should be able to identify a minimum of 5 areas of technology that are contributing to the discussion. Think about what that means for both your sector and your role. You’ll be able to evaluate risk as well as opportunity, the flip side. Then understand core areas of leadership and governance capability, that I certainly recommend that you develop. At the end I’m looking to give you some takeaways, which is areas for action. Let’s get started.
If you see the little Google icon like this it means there’s a lot of information that you can just basically go to Google for or my contacts are at the end. I have a wealth of information from completing my doctorate at QUT, which I did this year, 2016. I’ve got a lot of information and happy to share as well. Let’s talk about my favourite topic. It’s about, the first section is about the external environment and the size and scale of the change. Let’s jump right in to our poll question and see what it is we think we are talking about. What is digital disruption? Is it changes enabled by digital technology? Is it changes that are disrupting the creation? Is it changes to our social interactions or ways of doing business? Is it changes to business models or our ways of thinking about digital technology or is it all of the above?
Great! Well looks as though we’ve got our answers in. 93% of you are saying that it’s all of the above. 6% are saying that it’s changes enabled by digital technologies. You are both right, but all of the above is probably a better description. Let’s have a look at exactly what we’re talking about. Here are some examples of digital disruption that some of you will be familiar with. Clearly Airbnb and Uber are very well known to you. The key thing about what makes this disruptive, the disruption to the business model and the industry. Uber owns no taxis. It’s people, students, people who want a little bit of extra money to do their driving. Similarly with Airbnb and if you think the market capitalisation of Airbnb out stripped the Hyatt group about 5 years ago by about $2 billion. You can see the size and scale of the disruption in that particular sector.
Netflix is another really interesting one. Started out with streaming videos or leasing out videos and it has been the preeminent streamer of content. Now they are actually taking on the cinema area by developing their own movies and TV shows. They are competing with the TV and movie industries. There are of course a lot more examples. Alibaba is a really interesting one, the world’s largest retailer. All it is, is an app and a lot of warehouses and an aggregator. We are disrupting the business model but what is also happening is that, it’s happening so fast that what we’ve got is the disruptive being disrupted.
Here’s Uber and Lyft. What’s happening is they are being disrupted by for example the driver-less vehicle industry. If you think the ultimate goal of the driver-less vehicle industry is to actually replace on demand services. These disrupters who took out and created so much problem for the taxi industry for example. These disrupters themselves are predicted to be significantly disrupted by 2020. What you’ve got in 2020 for example is BMW, Audi, Ford, General Motors, Volvo, even Mercedes Benz, plus Google and Tesla the electric vehicles, will all have a driver-less vehicle or an autonomous vehicle on the road by 2020.
It doesn’t take a rocket scientist to realise that if your goal is to actually take out for example the taxis, the driver-less service vehicles are going to heavily impact taxis, trucks, transportation, buses, and specialist vehicles such as the heavy equipment that is already used in industry in Australia. You’ve got driver-less vehicles already in Australia. One of the points that I’m going to emphasise and reemphasise throughout this presentation is that digital disruption effects not just the IT person that you might or might not have on your board or your executive team. It effects all roles. If you are the HR expert on the board you need to be thinking now about what it is that you’ll need to planning for in your strategy if your industry is about to be disrupted. We’re going to come back onto this again.
What are the foundations of digital disruption? Let’s talk about disruptive technology. First of all it’s not just the technology that is slowly evolving. It’s something that is happening quickly. It is displacing technology and it shakes up the industry. Uber is a great example there. You’ve got basically an app that’s driven chaos into the technology industry or it comes in the form of a ground breaking product or service. Digital cameras for example were a ground breaking product or service in their day. Ultimately the disrupters are also being disrupted by innovation. It’s truly transformative because it really deviates from the established trajectory.
If you think about alternative energy of electric cars and how that currently is about to disrupt the automotive industry or the bottle fuel industry. Whether you agree with me or not, if you look at the competitive pricing of and the on road performance of electric vehicles if the figures are to be believed. It would be simply, extremely difficult to compete with trucks that can operate at a kilometre in terms of their fuel cost. Disruptive technology and disruptive innovation work in parallel and hand in hand. There are innovations happening in systems. If you think about how for example the Cloud, does it disrupt whether or not we have plugged in computers? Or software as a service interrupted the industry, we had to and go a box of technology and plug it in. Load up lots of disks and CD’s or just plain IT. based, a new type of technology such as robotics.
The heart of the this and the key that I really want to emphasise here is that a lot of the innovations and disruptions are actually being driven by customers. If people were fed up with being gouged by taxi drivers, that their energy costs were too high, or that they were getting poor service quality from their internet service provider. By customer demand a number of the innovations and disruptions are actually being driven by customer. The technology that were are using to give them a terrific customer experience is becoming more and more important. We will come onto that as well. Disruptive innovation is customer centred and it’s built on the technology and system. It’s basically any technology you need to deploy in your industry to become either a leader or as the research is saying now, to disrupt the disruptive.
You must be willing to disrupt your own business process and your product or services. Let’s talk about that again, disrupting the disrupters. I think we probably covered that enough from the point of view of cars. This is an interesting slide because it starts to introduce the range of technology, intimate, social, mobile, cloud are here. This is not in the future they are here. Why I put this complete diagram in is because they are converging. For example if you look at the robotics example here. Robotics are impacting for example healthy life, if you get into nanotechnology that’s being introduced and miniature robotics. You can also or really if you follow the mobile, think about smart watches or even just what your smart phone can tell you if you’ve got your health app turned on about your blood pressure, your heart rate, how many steps you’ve done, so on and so forth.
How that through sensing has connected people with a whole range of different things. Robotics, your smart phone, your mobile, can connect you increasingly to your healthcare. It connects you to your smart home, although that connection isn’t made in there. It can connect you to your car if you lost your car, and so on and so forth. A very important kind of disruption that isn’t just the technology itself. It’s how these technologies are being combined in innovative ways to make life interesting for people. As we start getting down into renewable energy. Printing, 3D printing is an interesting area, there are whole special 3D printed garments. We’re printing body parts. Fantastic research going on at universities around Australia about using human tissue to print body parts.
You can begin to see that these technologies that we know are already here are being combined to further disrupt. As you go up the arc over here, we are looking at some really radical change. Don’t be mistaken we are not talking twenty, thirty years in the future if you are talking driver-less vehicles your talking less that 4 years away. You are talking about a significant disruption to the transport industry for example. Also if you start to think about connected cities, smart homes, use of mobile in combination with these things. Most things even light, you can even buy lights down at one of the big firms, now has light bulbs with a sensor in it that can tell you how much electricity you are using, for example as your smart meter will. These things are happening and there will be literally millions of sensors in our day to day equipment within the next 3 to 5 years.
Disruptive convergence we’ve talked about that in that competitive position. This is only 1 I’ve followed the research about. The cost of electric vehicles versus gasoline, this particular example came out about 3 weeks ago. In fact the cost per mile is going down 2 cents or 12 cents plus per mile for a gasoline vehicle. Just to pick off on the right hand column here some of the impacts of autonomous vehicles. Motor vehicle insurance is predicted to be impacted particularly positively for customers because statistically the prediction is that although there has been some issues with driver-less vehicles having accidents, it’s interesting to consider that driver-less vehicles, they are predicted to have far less accidents than humans which should impact our insurance.
Public transportation won’t have as much cost infrastructure and will certainly be impacted from a point of view of HR and whether or not we need drivers. Fast food outlets have the potential to use driver-less vehicles and also all sorts of other types of alternate transportation that are emerging. If you don’t own the vehicle for example, and if you look at what Mercedes Benz is doing. They are talking about having a fleet of 20,000 vehicles in major European cities where you don’t have to own a vehicle. You just use your iPhone, call up your car when you need it. Therefore, you don’t need to park all day and have all those other operating costs for your vehicles, and so on and so forth. There are lots of ways that we can look at how disruption is potentially going to impact us.
Let’s talk about what it is. Digital disruption is rapid. It’s happening very fast and it’s changing how we look at the world. It’s also changing how we understand how we are going to go about business. I also would suggest it’s about to radically change our work-life practices. If you consider that I am running this webinar from a small country town and some of you will have dialled in from all over Australia, perhaps internationally. It, this is just the beginning of how different our work life is going to be. For it to be a digital disruption it is a threat to your personal, business or industry goals in the short or long term because of technology. It’s impacting societies, industry structures, business, work, and personal practices. If you go into, there is an excellent piece of research conducted by MIT Sloan and Capgemini that came out in 2012 and again in 2014.
Don’t think that you’re industry is exempt. What that research found on a global basis is that there are digital leaders in every industry and every type of organisation. Every size of organisation, whether they are for profit, government, not for profit, no exceptions. There are people in your industry sector, in an organisation like you taking advantage of digital transformation and technology and claiming a leadership role. That’s a part of the reason why this is so disruptive. There are implications. They can be the technological side. They can also impact the structural organisation of your industry. There are certainly cultural impacts in terms of how people and your organisation deal with this. On an internal and national scale there are political implications.
Let’s make some business sense of this. We talked a little bit about the external environment. I’d encourage you to get onto Google and look up digital disruption. There’s lots of stuff there. Follow some of the news threads like [inaudible 00:19:37] which I subscribe to. You’ll get lots of great information. Thing is, there are more internal issues and this is where you can start to effect change. Let’s talk about that internal environment and the technologies that we are thinking about. We talked about social, mobile, analytics, and the the internet of things. S.M.A.C.T technology is easy to remember example there. There are more than that. You’ve got your S.M.A.C.T technologies and you’ve got sensing, machine learning, artificial intelligence, robotics, and digital printing.
Now for example, if you are in the legal profession. We know that we always used to get the interns to read through piles and piles of paper and lots of examples. Of course we all know that machines and character recognition can screen and analyse sheets of paper. They don’t get sick, they don’t ask for overtime, and they can stay up all night til they get the job done. More than that though, they can apply artificial intelligence, and increasingly what we’re seeing is that there is actionable insights coming from artificial intelligence. Robots and robotics are taking over lots of different roles that human beings have been doing, with greater reliability, and with increasing disruption to the employment market.
Sensing is the one that is probably the least seen, developing. If you think about the 787 Dreamliner. That airplane has thousands of sensors on it in terms of anything that might need any kind of maintenance. Maintenance schedule is based on it and what they have already found is that because of sensing in the aviation industry they, airlines, are noticing decreases in cost at the gate because they are able to organise scheduled maintenance in advance. Each of these types of technologies is developing very rapidly and having it’s own impact.
The internet of things isn’t just about connecting it’s all about creating connections between your organisation and basically how you go about managing your supply chain. It’s a very interesting area if you are looking at the business of creating value. It’s strongly associated with data sharing and non-traditionally what we are starting to see is trains of sharing data not just with your customers and suppliers but also with competitors. Companies with good analytic sets where the internet of things come in. For example data comes in three times more likely to get value from the IoT than those who have weaker analytic capabilities. By the way one of the fastest growing and scarcest type of role, if you are in the hiring business, is people with analytic capabilities in this area.
Just be aware of growing needs for people with these kind of capabilities. Unlike many IT projects, internet of things can lead to diseconomies of scale. The disruptions are happening in nonstandard ways. What the latest research also says is that executive seem to underappreciate the potential security issues that accompany such device network growth. What that means is evidence that there is too little planning for security when people, companies are going into projects with any of these types of technology. Especially when they are implementing new platforms and systems and putting in place new approaches, practical approaches like bring your own device. Unfortunately security is too much of an after thought rather than a planning thought.
Here’s an example from General Motors. General Motors are taking actionable insights from sensors right across the business. Using that data for real time analytics. They’ve got sensors in the machines, in their industry. They are using remote starter as well and keeping that all within a secure network. They had literally embedded millions of sensors into their manufacturing business. One of the leading examples of use of sensors in combination with the data and real time analytics. Just the summarise there, those S.M.A.C.T technologies whichever are the most useful to your business are most likely to be used in combination to give you some competitive advantage of business improvement.
Digital disruption can be a threat and an opportunity. ICT is happening, change happening at such a pace that it is impacting existing business practices and threatening existing business models. It is also about new opportunities for creation. There are at least 6 areas of risk to discover. Those are competitive risk. If you go back to the thought every industry, no exception, has got disruption happening. Even to the humble plumber. Think about the competitive difference between the plumber who has got his business run, using mobile, he can do the job and invoice the customer, check the customer details on the job. That’s just one small improvement, but the competitive difference between the plumber who can send a robot down our drains to see if the robot can cut through roots that might have the drain. Inspect the drain to see whether or not it will be enough and removal is going to be cost competitive with the old style plumber that needs to come along, rip up your drain, dig up your garden to discover a minor crack in the pipe that could have been fixed with a robot. It’s genuinely every single industry.
In the structure risk, one of the interesting aspects of infrastructure risk is that old technology running old versions of Windows for example can be as much of a risk as not having any security at all. Hackers know about that. Unfortunately I don’t time in this particular seminar to go into cyber security. It is a whole area on it’s own. Cyber security and infrastructure impacts that, if you think about the Sony example. The hackers got in and literally shut Sony down a couple of years back. What they discovered is that the target example their information was held in very poor circumstances. People’s information including private information in the Target hack in 2014 was held in grid sheets that were very easy for the hackers to get to. Information security is an area on it’s own.
Not having the right people, I’ll come back on incompetencies, on the board and in non-IT roles in your organisation can be as much of a risk as any of the others because it’s not enough to just ask the questions. You have to have the capability to understand what is emerging, what is at risk, and where you’re likely to become competitively or technologically vulnerable. You have to be able to ask the right questions and have the right skills to question what you are being told by your IT people and by the external people that come to your organisation. Of course if you look at what keeps directors in particular and senior executives awake at night is that these risks can not only significantly impact the organisation financially, it can seriously damage your reputation as an organisation.
Where are we up to? We’ve gone past the IT craftsmanship where the IT department was in charge, through IT industrialisation, and where people put in large systems and IT management services. The IT started to treat colleagues as customers, now we are into digitalisation where the business models are digital leadership and digital business innovations are the new black. Look at that, the problem however on a global scale the statistics are pretty scary. The first one, only 16% of Fortune 100 Companies meet digital leadership capability criteria. 11% had sufficient digital intelligence. Unfortunately my slide has gone. Far too few, which is a risk mitigation strategy, are disclosing their digital security innovations in board papers.
The business case, this comes from my research. You can download this report from my research on my website which will be at the end. We’ve heard in other presentations that governance has become integrated. This would be because business and IT have basically become so merged our businesses rely so deeply on technology for our day to day running. IT and corporate governance have become rapidly integrated. The second criteria here is that we’ve come under increasing scrutiny that proven largely 14 years ago [inaudible 00:31:34]. Also by the voluntarily that our governance institutes and some governments have put in place. We’ve talked about the increasing disruption and one of the findings from my own research was point 4. That it’s great if we’ve got good government processes and committees in place in our organisations but what the Target example shows. You can have good governance in place but if you don’t have a culture as well as systems and process where it looks as though you’ve got a severe hack for example. People can get the information to your board of directors quickly.
What I am suggesting is that we need to have parallel standards and rapid response, risk response processes for boards these days. I’ll come onto that briefly again at the end. The upshot of all of this, the disruption, is that there are an enormous number of iconic brands disappearing. If you think about Kodak, AOL, and many many others. It’s not that they did anything necessarily wrong, it’s just that they didn’t keep up. They didn’t see the disruption coming. For example with Kodak the convergence of the digital phone and digital camera. Basically it took out a whole organisation. 2014 the with Target board and the senior executive as well as Wyndam Worldwide Corporation, the big hotel chain. Whole board were being sued. Read my report if you want to, it’s got details about those things.
Poll question number 2 please. Whose responsibility is it, digital leadership and IT governance. Is it the board, is it the CEO or managing director? Is it the IT department? Is it the legal department, finance, marketing, HR, or all of the above? Let’s stop the poll, thanks very much for those who responded. Interestingly enough the opinion was just about split. The first part said that it’s the board responsibility 52% said it’s all of the above. The answer is all of the above from the boards perspective. It’s all of the board and if you look at the true international law book, it was the board and all of the senior executive team. It wasn’t just the IT guy or woman was sued, it was the whole board and whole executive team. My case is that it is a joint accountability in order to meet your fiduciary duty of care.
To summarise then, it is the board and the minister or the CEO in combination with management. This diagram was essential point of governing pays references to the ISO standard 38500 which is that you need to have the capability to evaluate strategise direct and monitor your IT investments. That it needs to be an interlocking system of accountability. It’s how to structure, not only the board, but how you go about structuring the governance processes and project management processes. You performance management processes for example and how that plays out into your role of accountability. How that’s supported by processes. How you IT and tech support because a lot of internal IT disruption is about process and policy change and how that effects your decision quality. Your ability to make good prioritised investment decisions about that as a board and executive team is underpinned in my opinion by the digital intelligence that you are able to demonstrate.
Let’s talk about digital leadership and what we mean there. Digital leadership has a dual focus. The first focus is about the board’s capability to lead transformation intensity. Basically transformation intensity is your ability to put a vision of your organisation as a digital, in a digital world there and for you to have the governance in engagement with your stakeholders and that your suppliers, or internal and external stakeholder to steer the course. Then the second dimension is, not working…Okay. The second dimension is the board’s capability to lead digital intensity. Digital intensity is based on your understanding of what technology you’ve got, and what you need to put in place to enable the company to operate competitively in a digital environment, and to engage your customers and stakeholders from an improved internal operation. Even to look at your business models. Of course in the heart of that you’ve got S.M.A.C.T technology those other ones we’ve talked about so far.
This is available, there is a Google sign at the top. You can actually look at digital leadership based on the MIT Sloan research. What is really important for you to understand is that a lot of companies are in the Dabblers category. Excuse me. What they will do, these people might be in a new customer relationship management system. They lack the cohesion and the knowledge to maximise the benefits. Excuse me please. Where on the other hand I like the term “digiterati” What digital leaders are doing is driving value from the transformation in a combination of vision. What they’ve got is also the governance capability and the ability to engage stakeholders keeping their customers and stakeholders in the centre of the transformation to actually make it work.
What areas of capability? Let’s look at these capability areas. This is the detail of my research. It’s available if you go to Google or if you go onto my website. To lead and govern in the digital business strategy and organisation transformation. You need the capability to govern risk and compliance. You need to be able to lead and govern innovation and value creation. Under each of the 3 of capability areas on my website you’ve got a lot more information. There are criteria for example under lead and govern strategy. It’s about the need to be able to demonstrate knowledge about current and emerging digital technology and the potential to add organisational and customer value. There is 9 descriptors that you can use for evaluating your board capability or your senior executive team. There is 9 descriptors under the first one. There are 5 descriptions of the competency under descriptor 2. There are further 6 under lead and govern innovation for value creation. All this information is available to you. It’s good for board evaluation. You can conduct recruitments and use those for selection criteria.
What are the 4 essentials? Let’s look at some practical actions your board can take and examples through the reading. The first one is understand where you’re at. It’s just a business practice but in case the business sticks towards digital transformation. When you are at, where is your organisation at public, private, or not for profit. Where are you at the moment? What steps do you need to take? Do you understand your level of digital maturity for example? There should be a Google sign to the side of that. You IT maturity will tell you exactly what kind of IT you’ve got. It will tell you the age of your applications that your are running, where you’ve areas of opportunity and risk. You need to understand that in relation to the areas of risk and what opportunity you can create from that risk in the longer term.
How agile you need to be in the short term? One of the things I say to my clients is look outside of your organisation. Even sometimes your own sector at what, where this convergence might be about to disrupt you. If you were sitting on the board of the Hyatt you would not have expected that an application that connected customers with people with a room to rent would significantly erode the valuation of hotels for example. You need to think outside the square to give you that agility in the short term because of the speed of change.
Here is the digital maturity. Again the Google, this is a great area if you really want to understand it. There is research in this area. When optimised you’ve got the plan systems and processes, and that you measure where you actually are on a regular basis. I’d just like to emphasise that first point from the point of view of increasing your board capabilities. If you don’t do this already I would suggest that you have an IT scorecard as a part of your overall monitoring and measure. You are actually looking at where your business is, your ethics, your IT ethics and their life cycle. Just making sure that you understand the leaders that you’ve got their to call. That your IT and governance roles are clearly defined. As I said before that you’ve got governance processes as well agile governance processes in place so that you can take advantage of and not be left behind by technology change.
You need to understand the opportunity and risk. We talked a little bit about this, again there is enormous amounts of information on line about all of these areas or you can contact me if you would like more information. You must understand that every single on of those areas of risk including information security operates the potential to turn us into an opportunity. The big opportunity was information security and part of security in general is to plan security right from the get go with any investment in technology or any IT project. Don’t leave it until later.
This is a very helpful little chart that helps understand the standard and processes we’ve got with the agile processes that we’ve got. It’s based on a concept called bi-modal IT. Again you can look up more information on this. If you’re just starting out analysing where your organisation or your industry sector is at then it’s important to not just think we need to, we’re in this for the long haul, we need to take steady steps. We need to be careful of course because the whole thing about digital disruption is that your competitors will probably have good systems and processes in place and be running reliable plan for performance, plan driven incremental type changes. At the same time the digital leaders are running an agile short term process. That comes right down to agile project management and what they are doing with the governance. The agile parallel rapid risk response for example process. I am advocating strongly, I’ve written about it in my thesis, that it’s not just about having standard process in place now. That the new digital leaders have agile rapid response processes. When they are going about looking at governance for example. It is continuous, it’s capability based. They are understanding what strategy matching means in terms of their talents. It’s [inaudible 00:46:54] of business things in place.
Number 2 is creative vision. It’s about genuinely looking at organisation in context and reviewing the digital landscape. You ability to deliver to your key users. There is a checklist for you to look through. Also just to make sure that you base that on technologies that will improve. Keep that customer and stakeholder at the heart of what you are doing. You can do that, but also you can have an emphasis on operational effectiveness or a combination Essential action 3 is evaluate your capability inside the board. We talked a little about that. The key thing about that is to make sure that you’ve got an integrative strategy and to review policy and process. One of the reasons why so many IT projects fail or go overtime is that in the process of scoping the project it, people forget that the technology will impact the processes and policies. It can layers of costs and layers of time delays into your project. Make sure that you’ve got tactical and strategic streams that fast, slow, you’ve got your long haul but you’ve also got your agile processes. Measure everything that you do, but make sure that you’ve got good reporting and prioritised planning in investments in that slow, fast balance.
There are the physical leadership criteria. Having to change leadership capability as well as the ability to prioritise and put the right investment in place. The internal competency set in order to be able to lead the change. Digital roles, yes, mine certainly is. What I’ve encouraged for example my MBA students is to think about the finance people need to understand business models to the costs. The legal people need to be able to understand the impact on legislation. The legal ethics and ethical ethics of changes and so on and so forth. It is not just about the IT department anymore. Technology is impacting all roles, all levels, and your capabilities need to be strategy matching. I’ll also add to that, it’s not enough just to have a single IT person on the board. I’ve been there myself, if you’d don’t have capability across the board, then you are going to run into problems because you’re colleagues won’t have their own understanding of the impact in their roles.
Number 4, our final essential action, is review you governance processes and structure. There is an amended version of the Dartmouth process. What I’ve done here so that it is hopefully useful for you to look. There is your traditional board, executives good practices. There is nothing wrong with them but I strongly advocate that you also review your board processes to understand how you can become more like the digital leadership board with agile, parallel, rapid processes and strategy matching capabilities. You can take advantage of security and IT risks as everybody’s business throughout the organisation.
There is an IT scorecard. We’ve run out of time to go into any detail. There is plenty of detail about this. It’s part of whether or not you as a board of directors have actually got the right ability to say are we governing technology and digital transformation as a part of our business process and our regular process in the board. That will help reduce your risk of exposure. To finish, it’s about evaluating, directing, monitoring. Normal process, it’s just that IT business now, you can’t separate the 2. It’s about have you gone governance lead and how you deploy technology relevant to your business and in response to the rapidly changing digital environment.
There are 2 books that are found, are available. I have chapters in both of these books that have come out this year. Both have got lots of how-tos. The one from CCH Corporate Governance is very good for small organisations and not for profits. Headbook of governance [inaudible 00:52:33] with 50 experts in it. I’d like to offer the poll question, the final poll question. Thanks for attending. Your question, which type of technology do you use most frequently in the board room? Over to you in a second their Kate. We’ve got a real mixture coming through. Lots of people use iPads, one using an Android, 16% use their iPhones, others use their Android phone, 5% using Surface and 33% pretty much evenly split between iPads and laptops. Kate over to you for questions.
Kate Ellis: Thank you Elizabeth. Great presentation, really appreciate. Just a couple of key points that I’d like to share, that I’ve picked up from Elizabeth today while we wait for the questions to be submitted. Firstly interlocking of accountability across all functions, not just at the top but also through project management, board structure, departmental structure. Supported by all processes especially within the IT department. How each of these processes effect your reaction and decision policies. Making good prioritisation decisions is underpinned by the digital intelligence that you are able to understand and to demonstrate. Secondly understanding how agile you are as a business. Looking outside of your organisation sector and what convergences could come and disrupt you in your organisation. Finally have the right people across the company. That can support and identify merging technology opportunities, any vulnerabilities that you may be susceptible for. The key for that is having the right skills to the right people asking the right questions, all the way to the top. Having technology understanding across board members, not just with one person on your board.
We’re just going to keep it open for a couple more seconds for questions to build. While we do that we might just go to the last and final poll if we can. How are you documents currently being distributed at the board. Are you using documents printed and distributed by carrier, PDF documents distributed by email, Dropbox SharePoint, custom developed in house tools, or are you using a portal? Good coverage there. We’ve got around a third using PDF documents distributed by email. Another third in Dropbox and SharePoint. The final third is sitting in the board portal sector, and there is still a few being distributed by paper and with carriers. Thanks very much for that. Okay so we are running really short time. We will unfortunately have to stop and won’t get to all the questions today. IF you do ask some questions and we don’t get to you we will come back to you one on one after the webinar. Just bare with me while I mange the questions. First one Elizabeth, which emerging technology have you seen that within the insurance sector should we be aware of?
Elizabeth V.: Insurance sector funny enough I did a web conference with the International Security Officers of one of the largest European insurers. They were very much, it wasn’t so much about the technology, they were very interested as insurance becomes increasing business in online security. The role of the board in understanding not only the security and where their companies were actually at but what they needed to deploy to be more secure. In insurance, definitely an insurance, definitely a security issue and also increasingly mobile. The insurance industry is going be effected by the customer point of view very early on by digital disruption to industries. I used the example of the potential for policy changes for example with autonomous or driver-less vehicles. It’s not just the technology it’s about the impacts of the technology on the industry from the point of view of their internal operations as well as the impact on their customers and what they charge their customers for insurance.
Kate Ellis: Thank you Elizabeth. Another question similar but in the aged care sector.
Elizabeth V.:You would be surprised if you look at the uptake of technology in the elderly. The statistics deem the elderly as the over 65, which I find interesting. There is the potential for robotics, nanotechnology for medical. There will be increasing use of robots for heavy lifting for example. Obviously there is a cost but also a benefit to that. Those are the ones that I can think of immediately. There is a whole sector of autonomous vehicles. I was part of a conference that looked at ride sharing and autonomous vehicles for the aged care sector. People that were in residential care and how they could actually get people with liked interests sharing autonomous vehicles at much lower costs than they are currently doing. Whereas they might not be standard kind of acts on computers that they are using, certainly the tablet has changed that as well. A very interesting question and than you for that.
Kate Ellis: Thanks Elizabeth. Just a couple more before we need to finish. We are actually one minute over. What is the likely impact on state public transport authorities apart from the potential for driver-less vehicles and IT related issues?
Elizabeth V.: Goodness, this is a very big broad question. With permission I would rather take that one offline because it just appeared and I’d like to ask the person who asked the question exactly where they are coming from. It could be operational, it could strategic, it could be defeated from the point of view as they quite rightly identify from driver-less vehicles. It just appeared.
Kate Ellis: Absolutely thanks. I will share you the details of the person who asked the question. Also we have another question around disability services which we will need to discuss off the webinar. I would first like to thank everybody for joining us today, especially Elizabeth. Thank you so much for your time. It was a very insightful session.
Elizabeth V.: My pleasure.
Kate Ellis: Thanks. Anyone who is online if you do want to receive the presentation can you please click yes on the survey and we’ll get that out to you in the next 48 hours. My details are coming up if you’ve got anything that you’d like to share with me or discuss. Please do some. My email address is there at the bottom. Obviously just going to head back to Elizabeth’s details as well if you’d like to get in touch with her directly. Thanks very much. I hope you all have a great afternoon and I hope to see you again at another webinar and in the future.